On March 26, 2026, the Trump Administration issued a new Executive Order (EO) targeting diversity, equity, and inclusion (DEI) policies for federal contractors. The EO continues the Trump Administration’s hyper-trained focus on DEI, or what the President believes constitutes “racial discrimination in American society.” It follows a Department of Justice (DOJ) memorandum issued in May 2025 in which DOJ indicated it would utilize the False Claims Act (FCA) to target DEI policies for federal contractors, educational institutions, and companies doing business with the federal government. In the latest EO, the President states that “DEI activities are not only unethical and often illegal, but also cause inefficiencies, waste, and abuse within entities that engage in such practices” and raises concerns that the alleged costs associated with federal contractors’ DEI policies are then passed on to the government. The Trump Administration’s latest Executive Order on DEI has an immediate impact on federal prime contractors and subcontractors, requiring amendments to existing subcontracts, revision of internal corporate policies, and imposing FCA liability and administrative penalties for non-compliance. Read more here.